Older Drivers Face Triple Tax Hike in April Road Tax Overhaul
Older motorists across the UK are bracing for a significant financial impact as three major changes to Vehicle Excise Duty (VED) come into effect from April 2026. The Labour Party government's shake-up of what is commonly known as car tax or road tax will see increased costs for many drivers, particularly those with older vehicles.
Understanding Vehicle Excise Duty
Vehicle Excise Duty represents a mandatory fee that the majority of UK drivers must pay to legally operate their cars on public roads. The amount payable typically depends on several key factors including the vehicle's initial registration date, the type of fuel it uses, and the level of tailpipe CO2 emissions it produces. These rates undergo annual adjustments aligned with inflation, with the forthcoming increases scheduled for implementation on 1st April 2026 for the 2026/27 financial year.
VED Increases for Pre-2017 Vehicles
For vehicles registered between 1st March 2001 and 1st April 2017, substantial VED rises are anticipated. Cars emitting more than 225g of CO2 per kilometre will face particularly steep increases. The current band for vehicles producing 201-225g/km stands at £430, while those emitting 226-255g/km pay £735, and cars exceeding 255g/km face a £750 charge. From April 2026, these figures are set to climb, with the £735 band increasing to £760 and the £750 charge for over 255g/km vehicles expected to reach £790.
The RAC has commented on these developments, stating: "While the car tax rates for April 2026 onwards have yet to be officially released, we're expecting the cost of VED in 2026 to be £200 for most newer car drivers - up from £195. This rises in line with the Retail Price Index (RPI)."
Luxury Car Tax Adjustments
A significant change affects owners of higher-value vehicles through what is commonly termed the 'luxury car tax'. If a vehicle had an original list price exceeding £40,000 when first sold (or £50,000 for electric vehicles), drivers become liable for this additional fee. Currently adding £425 to annual VED costs, bringing the total to £620, this surcharge represents a substantial extra burden for owners of premium vehicles.
Electric Vehicle Tax Changes
In a notable policy shift, electric cars will no longer qualify for exemption from road tax. Starting from April 2026, EV drivers will begin paying a flat rate of £200 annually, marking the end of tax-free motoring for zero-emission vehicles and bringing them into the standard taxation framework.
Higher Fees for Pre-2001 Vehicles
Research indicates that many older drivers maintain their vehicles for extended periods, meaning some continue to operate cars registered before 2001. These older models operate under a different VED system based on engine size rather than emissions. From April 2026, vehicles with engines of 1549cc and below will see their annual bills increase from £220 to £230, representing a £10 rise. Meanwhile, cars with engines exceeding 1549cc will face a more substantial jump from £360 to £375 per annum.
The exact fee for annual road tax ultimately depends on three primary factors: the year of the vehicle's first registration, the type of fuel it uses, and its tailpipe emissions. Drivers with cars first used before 2017 may pay either less or more depending on these specific characteristics, making it essential for motorists to understand how these changes will affect their individual circumstances.
